Bitcoin Up 3%: What Will Inflation Data And Powell Speech Bring This Week?

BY Benzinga | ECONOMIC | 05/13/24 09:27 AM EDT

Bitcoin (CRYPTO: BTC) is carefully maintaining the $60,000 support level, navigating a delicate balance between bullish optimism and bearish caution.

What Happened: This week, as traditional financial sessions commence, Bitcoin remains anchored in a familiar range, yet poised for potential volatility influenced by impending U.S. macroeconomic data and remarks from Federal Reserve Chair Jerome Powell.

Market analysts are closely monitoring Bitcoin's performance, particularly the stability around the $60,000 mark, which has been sustained since early May.

Mark Cullen, a noted analyst, emphasized the significance of this level, stating, “Bitcoin still holding above 60k and the down trend break. That blue OB is going to be the key in the short term, lose it & we revisit the lows & likely much lower. Hold and another leg to take liquidity above the highs at 64-67k is likely.”

This precarious balance comes at a time when the cryptocurrency market could be influenced by several macroeconomic triggers.

The Consumer Price Index (CPI) release on May 14 is anticipated to be a critical indicator for Bitcoin's immediate financial trajectory. “If CPI inflation rises again this week, it will mark the third STRAIGHT monthly increase,” noted The Kobeissi Letter in a post, underscoring a bustling week ahead.

Further adding to the intrigue, Powell is scheduled to speak on economic issues in Amsterdam, which could provide further cues to the market.

Cryptocurrency markets have historically shown heightened sensitivity to Powell’s tone, particularly as it relates to future policy directions.

Simultaneously, seasoned Bitcoin holders are demonstrating patterns reminiscent of the 2021 bull market, choosing to increase their holdings amid lower prices, potentially to capitalize on future market highs.

Price Action: At the time of writing, Bitcoin is trading at $62,897, up 3% over the past 24 hours.

<figure class="wp-block-image size-full">Benzinga future of digital assets conference</figure>

Also Read: How Much Did Donald Trump’s Crypto Portfolio Pump After He Said He’s ‘Fine With It’?

Why It Matters: This cyclical behavior underscores a broader trend of growing long-term holder influence over Bitcoin’s available supply, which could have long-term implications for the market’s structure.

In the derivatives markets, neutrality prevails with funding rates remaining balanced, suggesting that the market is in a state of watchful waiting.

This sentiment is echoed in the Crypto Fear and Greed Index, which oscillates between fear and greed, indicating a market that is collectively unsure about the direction of the next big move.

What’s Next: As Nov. 19 approaches, the insights from Benzinga's Future of Digital Assets event will be crucial in potentially clarifying the path forward for Bitcoin and the broader cryptocurrency market, providing a deeper understanding of the interplay between macroeconomic policies and digital asset valuations.

Read Next: Donald Trump Says ‘You Better Vote’ For Him If You’re Pro-Crypto: But Has He Always Been ‘Fine With It’?

Image: Shutterstock

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Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

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